What is IOC in trading? Immediate or Cancel orders
- Asked By
- Updated On:26-May-2021
- Replies:2
Short Answer
To be precise, IOC or immediate or cancel orders are the type of time force orders which are bought and sold as soon as they are available in the market and the pending are cancelled.
Detailed Answer
Time in force orders in stock market are those where a unique directive is used to denote how lengthy an order can stay active until it is implemented or ends. In such cases, the investors or traders need to be very active and check a check on stocks because they are very specific with time limits.
Some common types of these types of order are:
- Fill or kick (FOK)
- good-'til-cancelled (GTC).
- day order
- immediate-or-cancel orders (IOC)
IMMEDIATE OR CANCEL ORDER:
- It is also referred to as IOC and are time-oriented orders which are offered to traders.
- It is the order type which needs to be implemented as soon as the stocks are offered in the market.
- When the stocks are offered, they are either bought or sold immediately and if the same is not done then it will not be kept as any sort of pending shares, it will be cancelled immediately.
- An IOC order might well be added to a trading account online.
- These stocks in case they are pending then will get cancelled automatically, this does not depend upon the trader as in he/she do not need to run any function to cancel it.
- It can also help the active traders to get done with such trades immediately instead to managing various active trades simultaneously.
- In this kind of order even Partial match is probable, while the incomparable is cancelled.
- It is also called as ‘zero duration’ order because there is not much time amid the offering of the stocks- its setting and its implementation.
WHY TO USE AND PLACE THESE ORDERS?
- They are used to make heavy and large orders only.
- Traders use these IOC orders when they feel and view that stocks are unpredictable, and so they try to cover them as quick as practicable at current market value.
- Traders also use it because they can make bulky orders but also do not manipulate anything in the arcade.
TYPES OF IMMEDIATE OR CANCEL (IOC) ORDERS:
IOC orders can be combined with both Limit orders and Market orders.
- In case of market IOC orders, the shares are implemented at the current market values.
- In case of limit IOC orders, the shares are implemented otherwise they are cancelled if a particular limit point of the shares are reached.
These both define the flexibility of IOC orders.
BENEFITS OF IMMEDIATE OR CANCEL (IOC) ORDERS:
- It is an easy way to deal with the shares as per the purchasing them.
- It will also save your time because it is very quick.
- Help the traders to place heavy and large orders at once.
To conclude, the IOC orders can be used in a very effective manner if it is studied and used in a proper way. It is also necessary to be quick and not to waste the orders by being blur about the idea of IOC.
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Discussion (1)
IOC simply stand for Immediate Or Cancel (IOC) orders. As you get more and more familiar with trading terms and slang, you might realize that each term is supposed to be linked with others, which form this sort of conjoined strategies. These strategies are usually what result in successful trading, rather than speculation.
IOC stands for Immediate or Cancel, which means if an order is not executed immediately under a given time frame, it will be liable to cancel.
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Harshil Patel
IOC order are a perfect ways to initiate a trade at the exact price that you require. Provided in the trade, shares are enough to buy or sell. If not the order would get cancelled or terminated immediately.